Luxury car dealer Jeff Dutton will next week begin building a
new showroom at 9-11 Claremont Street and has sold more than 65 per
cent of the offices in the $27 million project.

The six-storey mixed-use premises, designed by architects Fender
Katsalidis and SJB, is to be completed by December 2006, with
several suites fetching almost $7000 per square metre.

Colliers International marketing agent Peter Bremner said rents
for South Yarra office suites are about $290 per square metre,
providing a healthy 7 per cent yield. Mr Bremner expected a 5 per
cent premium on rents in the Dutton development, with strong
interest from financial planners, fashion businesses and smaller
recruitment firms.

"The area around South Yarra station is a hot spot of activity
at the moment and tenants are drawn by the lifestyle amenity and
retail, along with the proximity to public transport and the Monash
Freeway," he said.

Remaining suites ranged from 75 sq m to 182 sq m and were priced
from $425,000 to $1 million. Dutton Sporting Cars will occupy most
of the ground floor. Restaurateur Mauro Marcucci, of Termini and
Caffe e Cucina fame, will open Cafe Veloce in the remaining ground
floor space.

An arcade will link the building to a mixed-use project at 15-19
Claremont Street by developer Michael Yates that will have 3000 sq
m of office space, six rooftop apartments and a street-level
showroom.

Mr Yates said construction of the $12 million project began last
month, with marketing due to start next March.

He said land supply had been constrained by the former Tetley
Tea site in Yarra Street and the Burns Philp yeast factory in
Claremont Street, leading to pent-up demand for office space in the
Forest Hill precinct. Mr Yates bought the 7630 sq m Burns Philp
site for $9.25 million in 2002 and has recouped a substantial
portion of his initial outlay by selling three land parcels to
rival developers.

Buildcorp Commercial has recently completed a five-storey
development at 25 Claremont Street, with more than 90 per cent of
the 38 office suites already sold.

Jones Lang LaSalle leased the 845 sq m top floor of the building
to accounting firm Todes Williams & Ferguson on a strong
initial rental of $280 per sq m.

A joint venture between Andrew Rice and Craig Walton, of Walton
Construction, at 10 Yarra Street will include 70 office suites over
seven floors. Mr Rice said almost 20 per cent of the project had
already sold, with financial planning and accounting firm Michael
Pratt & Associates taking the fifth floor.

"Prior to the release of these sites, the only substantial
office space in South Yarra was the Como building, which has been
around for years," Mr Rice said.

The four projects will add 16,000 sq m of office space to the
CBD fringe market.